There is no government fund that pays wages when an employer fails
Some countries run a public insurance fund that pays workers directly when their employer becomes insolvent. The United States does not. What a worker gets instead is a better place in line: unpaid wages earned shortly before the bankruptcy get priority over ordinary unsecured claims, up to a capped amount per employee. Enter the petition date, the earliest date the unpaid wages were earned, the amount owed and the cap in force to see how the claim splits.
The window is counted backwards from the petition date, or from the date the business stopped operating if that came first, and every figure on this page uses that same reference point. Wages earned before the window drop entirely into the general unsecured pool.
Statutory basis (as of September 2026) — the wage priority is 11 U.S.C. 507(a)(4), covering wages, salaries and commissions earned within 180 days before the petition or the cessation of business, subject to a per-employee cap that is adjusted for inflation every three years under 11 U.S.C. 104. Contributions to employee benefit plans have a separate priority under 11 U.S.C. 507(a)(5). Outside bankruptcy, unpaid wages are pursued through the Department of Labor under the Fair Labor Standards Act or through a state labor agency wage claim.
This calculator is for reference only and is not legal advice. Priority status does not guarantee payment, because it depends on what the estate collects, so consult a licensed attorney about your specific situation.
Frequently Asked Questions
No. It only sets the order of payment. If the estate has too little after secured claims and administrative expenses, even a priority wage claim can be paid partly or not at all.
They are not lost, but they lose priority and become general unsecured claims, which are paid only after priority claims and usually at a fraction of face value.